4/12/2010 @ 12:00AM

State of Politics

Uttar Pradesh, Jaiprakash Gaur’s home state, is India’s most populous state, with 166 million citizens. Economically it has lagged behind the rest of India. The two expressways that Jaypee is building will provide a big boost to the state’s economy, say analysts. “The positive spinoffs will be enormous,” says Aashiesh Agarwaal, vice president at Edelweiss Capital in Mumbai. “There will be a huge multiplier effect, thanks to the employment these projects will generate.”

Doing business in UP, which often involves dealing with a fractious and caste- ridden political establishment, is never easy. The state’s political boss is Mayawati, a lower-caste Dalit leader now in her fourth stint as chief minister. Her Bahujan Samaj Party stormed back into power in 2007 on the back of the Dalit vote that she shrewdly combined with the upper class Brahmins she wooed. She has openly declared her ambition to be the country’s prime minister and was being talked of as a probable candidate until the last federal elections, when her party did less well than expected. UP is a crucial state in the federal elections because it has the largest number of representatives in parliament. This gives the party that rules UP a significant say in the formation of the federal government.

In a brazen bid to silence her opponents and critics who suggest that her power is waning, Mayawati recently hosted a massive rally in Lucknow, the state capital, to celebrate the 76th birthday of the late Kanshi Ram, her political mentor and her party’s founder. At the rally, party workers festooned Mayawati with a massive garland made of rupee notes. This sycophantic act sparked an uproar of criticism and an income tax inquiry. She countered by accepting a similar garland from her supporters two days later. Mayawati has been on a statue-building binge and Lucknow is filled with monuments to herself and her late mentor.

Jaypee benefits from Gaur’s ability to deal with politicians, says a banker. Its office in Lucknow, where Gaur’s son Sameer frequently works, is just a stone’s throw away from Mayawati’s official residence.